OTCPK:CREQ.F

Stock Analysis Report

China Rare Earth Holdings

Executive Summary

China Rare Earth Holdings Limited, together with its subsidiaries, engages in manufacturing and selling rare earth products and refractory products in the People’s Republic of China.

Rewards

Trading at 91% below its fair value

Became profitable this year

Risk Analysis

No risks detected for CREQ.F from our risk checks.


Snowflake Analysis

Flawless balance sheet and fair value.

Share Price & News

How has China Rare Earth Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CREQ.F has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

4.2%

CREQ.F

1.1%

US Metals and Mining

0.06%

US Market


1 Year Return

30.9%

CREQ.F

-1.9%

US Metals and Mining

19.3%

US Market

Return vs Industry: CREQ.F exceeded the US Metals and Mining industry which returned -1.9% over the past year.

Return vs Market: CREQ.F exceeded the US Market which returned 19.3% over the past year.


Shareholder returns

CREQ.FIndustryMarket
7 Day4.2%1.1%0.06%
30 Day-12.3%-3.4%1.7%
90 Day0%0.4%9.0%
1 Year30.9%30.9%0.6%-1.9%21.8%19.3%
3 Year-44.4%-44.4%-0.8%-6.1%49.5%39.9%
5 Year-69.6%-69.6%20.9%11.6%73.1%54.1%

Price Volatility Vs. Market

How volatile is China Rare Earth Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is China Rare Earth Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CREQ.F ($0.05) is trading below our estimate of fair value ($0.55)

Significantly Below Fair Value: CREQ.F is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CREQ.F is poor value based on its PE Ratio (44.7x) compared to the Metals and Mining industry average (11.1x).

PE vs Market: CREQ.F is poor value based on its PE Ratio (44.7x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate CREQ.F's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: CREQ.F is good value based on its PB Ratio (0.3x) compared to the US Metals and Mining industry average (1.5x).


Next Steps

Future Growth

How is China Rare Earth Holdings forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

13.4%

Forecasted Materials industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as China Rare Earth Holdings has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

  • Examine whether China Rare Earth Holdings is trading at an attractive price based on how much it is expected to earn in the future, and relative to its industry peers and the wider market.
  • While we do not consider unaudited financials to be a reliable enough to include in our analysis, you can access them on the OTC Markets Website. If you are looking for more of a qualitative research into the company, you can access China Rare Earth Holdings's filings and announcements here.
  • Explore growth companies in the Materials industry.

Past Performance

How has China Rare Earth Holdings performed over the past 5 years?

25.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CREQ.F has high quality earnings.

Growing Profit Margin: CREQ.F became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: CREQ.F has become profitable over the past 5 years, growing earnings by 25.9% per year.

Accelerating Growth: CREQ.F has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: CREQ.F has become profitable in the last year, making it difficult to compare its past year earnings growth to the Metals and Mining industry (-17.7%).


Return on Equity

High ROE: CREQ.F's Return on Equity (0.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is China Rare Earth Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: CREQ.F's short term assets (HK$2.5B) exceed its short term liabilities (HK$145.4M).

Long Term Liabilities: CREQ.F's short term assets (HK$2.5B) exceed its long term liabilities (HK$3.9M).


Debt to Equity History and Analysis

Debt Level: CREQ.F is debt free.

Reducing Debt: CREQ.F has no debt compared to 5 years ago when its debt to equity ratio was 2.3%.


Balance Sheet

Inventory Level: CREQ.F has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if CREQ.F's debt is covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: CREQ.F is profitable, therefore cash runway is not a concern.

Forecast Cash Runway: CREQ.F is profitable, therefore cash runway is not a concern.


Next Steps

Dividend

What is China Rare Earth Holdings's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage2.6%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate CREQ.F's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate CREQ.F's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CREQ.F's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CREQ.F's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: CREQ.F is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CREQ.F's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

11.0yrs

Average board tenure


CEO

Jiang DW Jiang (35yo)

2.4yrs

Tenure

HK$203,000

Compensation

Mr. Jiang Dawei, also known as Jiang DW has been Chief Executive Officer and Executive Director of China Rare Earth Holdings Limited since September 7, 2017. Mr. Jiang joined China Rare Earth Group as an o ...


CEO Compensation Analysis

Compensation vs Market: Jiang DW's total compensation ($USD26.08K) is below average for companies of similar size in the US market ($USD521.37K).

Compensation vs Earnings: Jiang DW's compensation has been consistent with company performance over the past year.


Board Members

NamePositionTenureCompensationOwnership
Yuanying Qian
Co-Founder & Chairman2.4yrsHK$1.10mno data
Dawei Jiang
CEO & Executive Director2.4yrsHK$203.00k0.023% HK$25.9k
Quanlong Jiang
Co-Founder & Executive Director0yrsHK$1.43mno data
Cainan Jiang
Deputy GM & Executive Director14.5yrsHK$160.00kno data
Chunhua Huang
Independent Non-Executive Director19.1yrsHK$72.00kno data
Zhong Jin
Independent Non-Executive Director15.4yrsHK$42.00kno data
Guozhen Wang
Independent Non-Executive Director7.5yrsHK$70.00kno data

11.0yrs

Average Tenure

60yo

Average Age

Experienced Board: CREQ.F's board of directors are seasoned and experienced ( 11 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

China Rare Earth Holdings Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China Rare Earth Holdings Limited
  • Ticker: CREQ.F
  • Exchange: OTCPK
  • Founded: 1987
  • Industry: Diversified Metals and Mining
  • Sector: Materials
  • Market Cap: HK$889.846m
  • Listing Market Cap: HK$114.329m
  • Shares outstanding: 2.34b
  • Website: https://www.creh.com.hk

Number of Employees


Location

  • China Rare Earth Holdings Limited
  • Dingshu Town
  • Yixing
  • Jiangsu Province
  • 214226
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CREQ.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 1999
769SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDNov 1999
RAEDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 1999

Biography

China Rare Earth Holdings Limited, together with its subsidiaries, engages in manufacturing and selling rare earth products and refractory products in the People’s Republic of China. The company offers rare earth products for use in electronic devices, computers, electronic motors, LCDs, DVDs, magnetic materials, magnetic memory chips, fiber optics, superconductors, mobile phone batteries, precision optics, and various energy-saving environmental protection products. It also provides refractory products, such as high temperature ceramics products for use in heat-treatment facilities for the petrochemical, steel metallurgy, non-ferrous metallurgy, glass, construction material, chemical fertilizer, and ceramics industries. In addition, China Rare Earth Holdings Limited trades in rare earth products; and exports its products to the United States, Japan, Europe, and Korea. The company was formerly known as Yixing Xinwei Holdings Limited and changed its name to China Rare Earth Holdings Limited in May 2000. China Rare Earth Holdings Limited was founded in 1987 and is headquartered in Yixing, the People’s Republic of China. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/20 23:57
End of Day Share Price2020/02/19 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.